The present invention provides novel processes and intermediates for the synthesis of the hydroxyethylene isostere dipeptide leu-val and similar transition state moieties. These compounds are useful in the synthesis of a large number of renin inhibitory peptides having this moiety in the 10,11 position corresponding to the renin substrate. See, e.g., U.S. Pat. No. 4,880,781, which is incorporated by reference herein. The sequence may readily be modified for the preparation of a large variety of both the N-terminal and C-terminal variants. When hydroxy ethylene isosteres of this type are incorporated into a variety of peptides they have enhanced or altered biological activity which makes them useful for treatment of a variety of disease states, particularly the treatment of hypertension.